RE: LETTER OF COURT OF APPEALS JUSTICE VICENTE S.E.

VELOSO FOR ENTITLEMENT TO

LONGEVITY PAY FOR HIS SERVICES AS COMMISSION MEMBER III OF THE NATIONAL LABOR
RELATIONS COMMISSION

The Resolution dated June 16, 2015, penned by Honorable Justice Arturo D. Brion (Brion), in A.M. Nos. 12-8-07-
CA, 12-9-5-SC, and 13-02-07-SC, resolved, among other matters, to deny the request of Court of Appeals (CA)
Justice Angelita A. Gacutan (Gacutan) to include her services as Commissioner of the National Labor Relations
Commission (NLRC) in the computation of her longevity pay.

CA Justice Gacutan filed a Motion for Reconsideration of said ruling, praying that herein ponente'sdissent to the
Resolution dated June 16, 2015, joined by five other Justices, prevails. In addition, CA Justice Gacutan submitted
that the grant by the Court of her request that her services in the NLRC (as of 2006) be included in computing her
longevity pay would be a reward for her past continuous services as a lifelong public servant who eventually retired
from the judiciary, and that "by granting her request, there is no judicial legislation - there is only the
recognition of justice and equity to which we in the judiciary stand for."

Xxx

Justice Gacutan was still a Commissioner of the NLRC when Republic Act No. 9347 took effect. From the date of
effectivity of the law onwards, her services as NLRC Commissioner are therefore covered by the beneficial effect of
the amendment of Article 216 of the Labor Code by Republic Act No. 9347, which gave the NLRC Commissioners
the same rank and salary as Associate Justices of the Court of Appeals. As Republic Act No. 9347 expresses the
intent to place the NLRC Commissioners in exactly the same footing as their counterparts in the Court of Appeals,
and "salary" includes longevity pay, then Justice Gacutan's longevity pay should be reckoned from August 26, 2006,
the date Republic Act No. 9347 took effect, at which time she was still NLRC Commissioner. Thus, five years after
that date, or on August 26, 2011, she became entitled to receive longevity pay equivalent to 5% of her monthly basic
pay at that time; and, she is now entitled to adjustment of salary, allowances, and benefits only as of that date.

As regards her request that her entire services as NLRC Commissioner be credited as part of her government service
for the purpose of retirement under Republic Act No. 910, as amended by Republic Act No. 9946, the same may be
allowed as it is in accordance with Section 1 of Republic Act No. 910, as amended by Republic Act No. 9946, which
requires fifteen (15) years service in the Judiciary or in any other branch of the Government as a condition for
coverage of the said law.
Clearly, the foregoing ratiocination does not constitute judicial legislation. It is firmly grounded on existing laws,
jurisprudence, and executive contemporaneous construction. It was Congress which enacted Republic Act Nos.
9417, 9347, and 10071, granting certain officials of the Executive Department the same salary as their respective
counterparts in the Judiciary, and "salary" refers to basic monthly pay plus longevity pay per the plain language of
Section 42 of Batas Pambansa Big. 129. Justice Brion opines that the grant of longevity pay to executive officials
would effectively be a misplaced exercise of liberality at the expense of public funds and to the prejudice of sectors
who are more in need of these funds. It bears to stress though that it is irrefragably within the legislative power of
Congress to enact Republic Act Nos. 9417, 9347, and 10071, a

Dissenting

The Grant of Longevity Pay Prayed for is an Act of Judicial Legislation.

The grant of longevity pay for past services in the NLRC, based on the grant of longevity pay to judges and justices
of the judiciary, amounts to prohibited judicial legislation.

Section 42 of BP 129 is clear in requiring five years of meritorious, efficient, and continuous services in the
judiciary subsequent legislation conferring the same salary and benefits that judges and justices enjoy to designated
counterparts in the executive did not amend this requirement, expressly or impliedly.

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RA No. 9347, in particular, did not specifically provide that the services in the NLRC may be tacked with the length
of judicial service for purposes of computing longevity pay in the judiciary. Neither can the tackmg of these periods
be implied from the language of Article 216 of the Labor Code, as amended, as the provision merely uses the salary
and benefits of CA Associate justices as a yardstick for determining the salary and benefits of NLRC
commissioners.

It must be pointed out that the grant of the requested longevity pay can be a blow disastrous to the reputation of the
judiciary and to this Court's role as the final authority in interpreting the Constitution, when the public realizes
that this Court engaged in judicial legislation, through interpretation, to undeservedly favor its own judges and
justices.

Xxx

A Grant would effectively be a Misplaced Exercise of Liberality at the Expense of Public Funds and to the
Prejudice of Sectors who are More in Need of these Funds.
The liberal approach does not allow the inclusion of the period of services in the NLRC (or any executive office) to
the period of judicial service to grant longevity pay in the judiciary, The law is clear and unequivocal in its
requirements for the grant of longevity pay, and cannot thus be amended through a claimed liberal approach.

The Court should not forget that liberality is not a magic wand that can ward off the clear terms and import of
express legal provisions; it has a place only when, between two positions that the law can both accommodate, the
Court chooses the more expansive or more generous option. It has no place where no choice is available at all
because the terms of the law are clear and do not at all leave room for discretion, 12chanrobleslaw

In terms of the longevity pay's purpose, liberality has no place where service is not to the judiciary, as the element of
loyalty - the virtue that longevity pay rewards - is not at all present.

I cannot overemphasize too that the policy of liberal construction cannot and should not be to the point of
engaging in judicial legislation -an act that the Constitution absolutely forbids this Court to do. The Court may
not, in the guise of interpretation, enlarge the scope of a statute or include, under its terms, situations that were not
provided nor intended by the lawmakers. The Court cannot rewrite the law to conform to what it or certain of its
Members think should be the law.

Not to be forgotten is the effect of this Court's grant on the use of public funds; funds granted to other than the
legitimate beneficiaries are misdirected funds that may be put to better use by those sectors of society who need
them more.

For these reasons, I vote DENY with FINALITY the Motion for Reconsideration filed by former Court of Appeals
Associate Justice Angelita Alberto-Gacutan.

Xxx

The Instant Requests Considered

Justices Veloso and Gacutan anchor their claim on Article 216 of the Labor Code, as amended by Republic Act No.
9347, which reads:ChanRoblesVirtualawlibrary

Article 216. Salaries, Benefits and Emoluments. -The Chairman and Members of the Commission shall have the
same rank, receive an annual salary equivalent to, and be entitled to the same allowances, retirement and
benefits as those of the Presiding Justice and Associate Justices of the Court of Appeals, respectively. Labor
Arbiters shall have the same rank, receive an annual salary equivalent to and be entitled to the same allowances,
retirement and other benefits and privileges as those of the Judges of the Regional Trial Courts. In no case, however,

2
shall the provision of this Article result in the diminution of the existing salaries, allowances and benefits of the
aforementioned officials. (Emphases supplied.)

TOLENTINO VS. ONGSIAKO GR L-17938 APRIL 30, 1963

FACTS: Plaintiff-appellant claims to be the successor-in-interest of the late Severino Domingo, who was involved
in a case against Ongsiako. Plaintiff-appellant said that Domingo died without ever receiving the decision of the
case, and he has just found out of the decision, over 20 years since its promulgation. This prompted him to file a
complaint for the enforcement of the dissenting opinion. This was dismissed by the trial court for lack of cause of
action.

ISSUES: Whether or not appellant’s claim that decision was erroneous and unjust is tenable? Whether or not one
can move for the enforcement of the dissenting opinion?

HELD: On the first issue, it is untenable. Appellant is barred by res judicata, the decision of the case being final
and executory for a long time already. On the second issue, the enforcement of the dissenting opinion is ridiculous
as the dissenting opinion enforces no right, claim, or whatsoever. It is just a dissent from the conclusion of the case.

ORTIGAS & CO., LIMITED PARTNERSHIP, plaintiff-appellant,

vs.
FEATI BANK AND TRUST CO., defendant-appellee.

FACTS:

Ortigas and Co. is engaged in real estate business developing and selling lots to the public. It sold to Augusto
Padilla and Natividad Angeles Lots Nos. 5 and 6, Block 31 of the Highway Hills Subdivision, Mandaluyong by sale
on instalments. The vendees then transferred their rights and interests over the aforesaid lots in favour of one Emma
Chavez. The agreements of sale on instalment and the deeds of sale contained the restriction that “The parcel of
land subject of this deed of sale shall be used by the Buyer exclusively for residential purposes, and she shall not be
entitled to take or remove soil, stones or gravel from it or any other lots belonging to the Seller.”

Feati Bank and Trust Co. later bought said lots from Emma Chavez in the name of Republic Flour Mills. Ortigas
and Co. claims that the restrictions were imposed as part of its general building scheme designed for the
beautification and development of the Highway Hills Subdivision which forms part of its big landed estate. Feati
Bank, on the other hand, maintains that the area along the western part of EDSA from Shaw Boulevard to Pasig
River has been declared a commercial and industrial zone, per Resolution No. 27 s-1960 of the Municipal Council
of Mandaluyong, Rizal. Later on, Feati Bank commenced construction on the said lots for a building devoted to
banking purposes. It refused to comply with the demands of Ortigas & Co. to stop the said construction.

ISSUE:Whether or not Resolution No. 27 s-1960 can nullify or supersede the contractual obligations assumed by
the defendant.

HELD:

Yes. While non-impairment of contracts is constitutionally guaranteed, the rule is not absolute, since it has to be
reconciled with the legitimate exercise of police power, i.e. “ the power to prescribe regulations to promote the
health, morals, peace, education, good order or safety of the general welfare of the people.” This general welfare
clause shall be liberally interpreted in case of doubt, so as to give more power to local governments in promoting the
economic conditions, social welfare and material progress of the people in the community. The only exceptions
under Section 12 of the Local Autonomy Act (R.A. 2264) are existing vested rights arising out of a contract between
a province, city or municipality on one hand and a third party on the other hand. Said case is not present in this
petition.

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 Resolution No. 27 s-1960 declaring the western part of EDSA as an industrial and commercial zone was passed in
the exercise of police power to safeguard or promote the health, safety, peace, good order and general welfare of the
people in the locality.

ON AMERICAN JURISPRUDENCE:

One last observation. Appellant has placed unqualified reliance on American jurisprudence and authorities 52 to
bolster its theory that the municipal resolution in question cannot nullify or supersede the agreement of the parties
embodied in the sales contract, as that, it claims, would impair the obligation of contracts in violation of the
Constitution. Such reliance is misplaced.

In the first place, the views set forth in American decisions and authorities are not per se controlling in the
Philippines, the laws of which must necessarily be construed in accordance with the intention of its own lawmakers
and such intent may be deduced from the language of each law and the context of other local legislation related
thereto. 53 and Burgess, et al v. Magarian, et al., 55 two Of the cases cited by plaintiff-appellant, lend support to the
conclusion reached by the trial court, i.e. that the municipal resolution supersedes/supervenes over the contractual
undertaking between the parties. Dolan v. Brown, states that "Equity will not, as a rule, enforce a restriction upon
the use of property by injunction where the property has so changed in character and environment as to make it
unfit or unprofitable for use should the restriction be enforced, but will, in such a case, leave the complainant to
whatever remedy he may have at law. 56 (Emphasis supplied.) Hence, the remedy of injunction in Dolan vs.
Brown was denied on the specific holding that "A grantor may lawfully insert in his deed conditions or restrictions
which are not against public policy and do not materially impair the beneficial enjoyment of the estate. 57 Applying
the principle just stated to the present controversy, We can say that since it is now unprofitable, nay a hazard to the
health and comfort, to use Lots Nos. 5 and 6 for strictly residential purposes, defendants- appellees should be
permitted, on the strength of the resolution promulgated under the police power of the municipality, to use the same
for commercial purposes. In Burgess v. Magarian et al. it was, held that "restrictive covenants running with the land
are binding on all subsequent purchasers ... " However, Section 23 of the zoning ordinance involved therein
contained a proviso expressly declaring that the ordinance was not intended "to interfere with or abrogate or annul
any easements, covenants or other agreement between parties." 58 In the case at bar, no such proviso is found in the
subject resolution.

It is, therefore, clear that even if the subject building restrictions were assumed by the defendant-appellee as vendee
of Lots Nos. 5 and 6, in the corresponding deeds of sale, and later, in Transfer Certificates of Title Nos. 101613 and
106092, the contractual obligations so assumed cannot prevail over Resolution No. 27, of the Municipality of
Mandaluyong, which has validly exercised its police power through the said resolution. Accordingly, the building
restrictions, which declare Lots Nos. 5 and 6 as residential, cannot be enforced.

CENTRAL BANK EMPLOYEES ASSOCIATI ON V. BSP (2004) | E QUAL

PROTECTION CLAUSE

February 5, 2017

G.R. No. 148208, 446 SCRA 299, December 15, 2004

Doctrines:
1. Elements of valid class legislation: (1) must rest on substantial distinctions; (2) must be germane to the
purposes of the law; (3) must not be limited to existing conditions only; (4) must apply equally to all
members of the same class
2. Relative Constitutionality. The fact that a statute is constitutional at first does not mean it is constitutional
forever. The subsequent changes in the original circumstance surrounding the law would affect its validity.

4
 Facts:
1. The new Central Bank Act took effect and gave way for the creation of Bangko Sentral ng Pilipinas.
2. Other Governmental Financial Institutions (GFIs) also amended their charters.
3. After almost 8 years following the amendment of the GFIs’ charters, BSP’s employees, through petitioner, filed a
petition for prohibition against the BSP and the Executive Secretary to restrain the respondents from further
implementing the last proviso in Sec. 15, Art. II of the New Central Bank Act (i.e., the exemption from the Salary
Standardization Law (SSL) of all employees with salary grade of 19 and the non-exemption of those having a
salary grade under 19). They alleged its constitutionality for being an invalid “class legislation”.
Petitioner’s Contentions:
1. The said proviso violates equal protection clause because only the officers of the BSP (those holding the salary
grade of 19 and up) are exempted from the SSL.
2. Those belonging from 19 and up and those 19 below do not really differ from one other in terms of the nature of
work and expertise.
3. Other GFIs, which are the same as the BSP, exempt all their rank-and-file personnel from SSL without any
distinction.
BSP’s contention:
1. The proviso is not unconstitutional as it can stand the constitutional test, provided it is construed in harmony with
other provisions of the same law, such as the mandate of the Monetary Board to “establish professionalism and
excellence at all levels in accordance with sound principles of management.”
Solicitor General, on behalf of respondent Executive Secretary:
1. The proviso is not unconstitutional as the classification is based on actual and real differentiation, even as it
adheres to the enunciated policy of the new SB Act to establish professionalism and excellence within the BSP
subject to prevailing laws and policies of the national government.
Issue: WON the proviso is unconstitutional for being violative of equal protection clause.
Held:
 YES, the proviso is unconstitutional for being violative of the equal protection clause.
 Equal protection clause does not prevent the Legislature from establishing classes of individuals or objects upon
which different rules shall operate – so long as the classification is not unreasonable. Equality of operation of
statutes does not mean indiscriminate operation on persons themselves, but on persons according to the
circumstances surrounding them. It guarantees equality, not identity of rights.
 In the case at bar, it is clear in the legislative deliberations that the exemption of officers (SG 20 and above) from
the SSL was intended to address the BSP’s lack of competitiveness in terms of attracting competent officers and
executives. It was not intended to discriminate against the rank-and-file and the resulting discrimination or
distinction has a rational basis and is not palpably, purely, and entirely arbitrary in the legislative
sense. However, in the subsequent passages of the amendment on the charters of other GFI, the
surrounding circumstances of the case changed.
 The subsequent amendments of the other GFIs’ charter (i.e., express authorization to determine and institute
its own compensation and wage structure, and explicit exemption – without distinction as to salary grade or
position – all employees of the GFI from the SSL) resulted to the oppressive results of Congress’ inconsistent
and unequal policy towards the BSP rank-and-file and those of the seven other GFI. In the case at bar, it is
precisely the fact that as regards the exemption from the SSL, there are no characteristics peculiar only to
the seven GFIs or their rank-and-file so as to justify the exemption which BSP rank-and-file employees
were denied (not to mention the anomaly of the SEC getting one). The distinction made by the law is not only
superficial, but also arbitrary. It is not based on substantial distinctions that make real differences between
the BSP rank-and-file and the seven other GFIs.
 The subsequent grant to the rank-and-file of the seven other GFIs and continued denial to the BSP rank-and-file
employees of the exemption from SSL breached the latter’s right to equal protection.
 The equal protection clause does not demand absolute equality but it requires that all persons shall be treated
alike, under like circumstances and conditions both as to privileges conferred and liabilities enforced.

On American Jurisprudence:

To illustrate further, if petitioner's constitutional challenge is premised on the denial of a "fundamental right" or the
perpetuation of prejudice against a "suspect class," as suggested (but not fully explicated) in the closing pages of the
main opinion; then, following the trend in American jurisprudence, the Strict Scrutiny Test would be applicable,

5
whether the classification being reviewed is that between the officers and rank and file of the BSP or between the
rank and file of the BSP and the rank and file of the other GOCCs/GFIs.

Notably, the main opinion, after discussing lengthily the developments in equal protection analysis in the United
States and Europe, and finding no support thereto, incongruously concluded that "in resolving constitutional
disputes, this Court should not be beguiled by foreign jurisprudence some of which are hardly applicable because
they have been dictated by different constitutional settings and needs." 171 After an excessive dependence by the main
opinion to American jurisprudence it contradicted itself when it stated that "American jurisprudence and authorities,
much less the American Constitution, are of dubious application for these are no longer controlling within our
jurisdiction and have only limited persuasive merit." 172

Yao Kee, Sze Sook Wah, Sze Lai Cho, and Sy Chun Yen, petitioners, versus Aida Sy-Gonzales, Manuel Sy,
Teresita Sy-Bernabe, Rodolfo Sy, and Honorable Court of Appeals, respondents.
No. L-55960 November 24, 1988

Facts:

Sy Kiat, a Chinese national, died on January 17, 1977 in Caloocan City where he was then residing, leaving behind
real and personal properties here in the Philippines worth P300,000.00 more or less.

Thereafter, Aida Sy-Gonzales, Manuel Sy, Teresita Sy-Bernabe and Rodolfo Sy filed a petition alleging among
others that:

a) They are the children of the deceased with Asuncion Gillego;

b) To their knowledge Sy Kiat died intestate;
c) They do not recognize Sy Kiat’s marriage to Yao Kee nor the filiation of her children to him; and
d) They nominate Aida Sy-Gonzales for appointment as administratriz of the intestate estate of the deceased.

The petition was opposed by Yao Kee, Sze Sook Wah, Sze Lai Cho and Sy Yun Chen who alleged that:

a) Yao Kee is the lawful wife of Sy Kiat who he married on January 19, 1931 in China;
b) The other oppositors are the legitimate children of the deceased Yao Kee; and
c) Sze Sook Wah is the eldest among them and is competent, willing and desirous to become the administratrix of
the estate of Sy Kiat.

Yao Kee testified that she was married to Sy Kiat on January 19, 1931 in Fookien, China; that she does not have a
marriage certificate because the practice during that time was for elders to agree upon the bethrotal of their children,
and in her case, her elder brother was the one who contracted or entered into an agreement with the parents of her
husband; that she and her husband have been living in Fookien, China before he went to the Philippines; that in
China, the custom is that there is a go-between, a sort of marriage broker who is known to both parties who would
talk to the parents of the bride-to-be agree to have the groom-to-be their son-in-law, then they agree on a date as an
engagement day; that on the wedding day, the document would be signed by the parents of both parties but there is
no solemnizing officer as is known in the Philippines; that the parties do not sign the document themselves; and that
she and Sy Kiat were married for 46 years already and the document was left in China and she doubt if that
document can still be found now.

The testimony of Gan Ching, the younger brother of Yao Kee, that he attended the marriage of his sister with Sy
Kiat and that no marriage certificate is issued by the Chinese government, a document signed by the parents
and elders of the parties being sufficient. Statements were made by Asuncion Gillego when she testified that a) Sy
Kiat was married to Yao Kee according to a Chinese custom.

6
Issue:

Whether or not the marriage of Sy Kiat to Yao Kee in China is valid.

Held:

The law requires that a custom must be proved as a fact, according to the rules of evidence. A local custom as a
source of right cannot be considered by a court of justice unless such custom is properly established by competent
evidence like any other fact.

Article 71 of the Civil Code states that: “All marriages performed outside the Philippines in accordance with the
laws in force in the country where they were performed, and valid there as such, shall also be valid in this country,
except bigamous, polygamous or incestuous marriages as determined by Philippine law.

The testimonies of Yao Kee and Gan Ching cannot be considered as proof of China’s law or custom on marriage not
only because they are self-serving evidence, but more importantly, there is no showing that they are competent to
testify on the subject matter. The marriage of Yao Kee and Sy Kiat cannot be recognized in this jurisdiction.
Philippine courts cannot take judicial notice of foreign laws. They must be alleged and proved as any other fact.

As petitioners failed to establish the marriage of Yao Kee with Sy Kiat according to the laws of China, they cannot
be accorded the status of legitimate children but only of acknowledged natural children.

FROM THE PERSPECTIVE OF ART. 11-12 OF THE CIVIL CODE

In The Matter of the Petition for Authority to Continue Use of the Firm Name “Ozaeta, Romulo, De Leon…” etc. 92
SCRA 1 July 30, 1979

Melencio-Herrera, J.:

Facts: The surviving parters of Atty. Herminio Ozaeta filed a petition praying that they be allowed to continue using,
in the name of their firm, the names of their partner who passed away. One of the petitioners’ arguments stated that
no local custom prohibits the continued use of a deceased partner’s name in a professional firm’s name in so far as
Greater Manila Area is concerned. No custom exists which recognizes that the name of a law firm necessarily
identifies the individual members of the firm. They also stated that the continued use of a deceased partner’s name
in the firm name of law partnerships has been consistently allowed by U.S. Courts and is an accepted practice in the
legal profession of most countries in the world.

Issue: Whether or not the law firm “Ozaeta, Romulo, De Leon, Mabanta & Reyes” is allowed to sustain the name of
their deceased partner, Atty. Herminio Ozaeta, in the name of their firm.

Held: NO. Canon 33 of the Canons of Professional Ethics adopted by the American Bar Association stated the
following: “The continued use of the name of a deceased or former partner when permissible by local custom, is not
unethical but care should be taken that no imposition or deception is practiced through this use.” No local custom
permits or allows the continued use of a deceased or former partner’s name in the firm names of law partnerships.
Firm names, under Philippine custom, identify the more active or senior partners in a firm. Firm names in the
Philippines change and evolve when partners die, leave or a new one is added. It is questionable to add the new
name of a partner and sustain the name of the deceased one since they have never been, technically, partners in the
first place. When it comes to the arguments of the petitioners stating that U.S. Courts grant the continued use of the
deceased partner’s name, this is so because in the U.S., it is a sanctioned custom as stated in the case of Mendelsohn
v. Equitable Life Assurance Society (33 N.Y.S 2d 733). This does not apply in the Philippines. The petition filed
herein is denied and petitioner is advised to drop the name “OZAETA” from the firm name.

Lex Loci Celebtrationis

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Tenchavez v. Escano

G.R. No. L-19671, 29 November 1965

FACTS:

Vicenta Escaño, 27, exchanged marriage vows with Pastor Tenchavez, 32, on February 24, 1948, before a Catholic
chaplain. The marriage was duly registered with the local civil registrar. However, the two were unable to live
together after the marriage and as of June 1948, they were already estranged. Vicenta left for the United Stated in
1950. On the same year she filed a verified complaint for divorce against Tenchavez in the State of Nevada on the
ground of “Extreme cruelty, entirely mental in character.” A decree of divorce, “final and absolute” was issued in
open court by the said tribunal. She married an American, lived with him in California, had several children with
him and, on 1958, acquired American Citizenship.

On 30 July 1955, Tenchavez filed a complaint in the Court of First Instance of Cebu, and amended on 31 May 1956,
against Vicenta F. Escaño, her parents, Mamerto and Mena Escaño whom he charged with having dissuaded and
discouraged Vicenta from joining her husband, and alienating her affections, and against the Roman Catholic
Church, for having, through its Diocesan Tribunal, decreed the annulment of the marriage, and asked for legal
separation and one million pesos in damages. Vicenta’s parents denied that they had in any way influenced their
daughter’s acts, and counterclaimed for moral damages.

ISSUE:

1. Whether or not the divorce sought by Vicenta Escaño is valid and binding upon courts of the Philippines.

2. Whether or not the parents of Vicenta alienated the affections of their daughter and influenced her conduct toward
her husband.

RULING:

1. No. Vicenta Escaño and Pastor Tenchavez’ marriage remain existent and undissolved under the Philippine Law.

Pursuant to Article 15 of the Civil Code, laws relating to family rights and duties, or to the status, condition and
legal capacity of persons are binding upon citizens of the Philippines, even though living abroad.

Escaño’s divorce and second marriage cannot be deemed valid under the Philippine Law to which Escaño was
bound since in the time the divorce decree was issued, Escaño, like her husband, was still a Filipino citizen. The acts
of the wife in not complying with her wifely duties, deserting her husband without any justifiable cause, leaving for
the United States in order to secure a decree of absolute divorce, and finally getting married again are acts which
constitute a willful infliction of injury upon the husband’s feelings in a manner contrary to morals, good customs or
public policy, thus entitling Tenchavez to a decree of legal separation under our law on the basis of adultery.

2. No. There is no evidence that the parents of Vicenta, out of improper motives, aided and abetted her original suit
for annulment, or her subsequent divorce.

A portion of Section 529 reads: The law distinguishes between the right of a parent to interest himself in the marital
affairs of his child and the absence of rights in a tranger to intermeddle in such affairs. …A parent is liable for
alienation of affections resulting from his own malicious conduct, as where he wrongfully entices his son or
daughter to leave his or her spouse, but he is not liable unless he acts maliciously, without justification and from
unworthy motives.

8
Therefore, her parents, in respecting Vicenta’s independent decisions, certainly cannot be charged with alienation of
affections in the absence of malice or unworthy motives.

MINORU FUJIKI v. MARIA PAZ GALELA MARINAY, GR No. 196049, 2013-06-26

Facts:
Petitioner Minoru Fujiki (Fujiki) is a Japanese national who married respondent Maria Paz Galela Marinay
(Marinay) in the Philippines[2] on 23 January 2004. The marriage did not sit well with petitioner's parents. Thus,
Fujiki could not bring his wife to
Japan where he resides. Eventually, they lost contact with each other.
In 2008, Marinay met another Japanese, Shinichi Maekara (Maekara). Without the first marriage being dissolved,
Marinay and Maekara were married on 15 May 2008 in Quezon City, Philippines. Maekara brought Marinay to
Japan. However, Marinay allegedly suffered physical abuse from
Maekara. She left Maekara and started to contact Fujiki.[3]
Fujiki and Marinay met in Japan and they were able to reestablish their relationship. In 2010, Fujiki helped Marinay
obtain a judgment from a family court in Japan which declared the marriage between Marinay and Maekara void on
the ground of bigamy.[4] On
14 January 2011, Fujiki filed a petition in the RTC entitled: "Judicial Recognition of Foreign Judgment (or Decree
of Absolute Nullity of Marriage)." Fujiki prayed that (1) the Japanese Family Court judgment be recognized; (2) that
the bigamous marriage between Marinay and
Maekara be declared void ab initio under Articles 35(4) and 41 of the Family Code of the Philippines;[5] and (3) for
the RTC to direct the Local Civil Registrar of Quezon City to annotate the Japanese Family Court judgment on the
Certificate of
Marriage between Marinay and Maekara and to endorse such annotation to the Office of the Administrator and Civil
Registrar General in the National Statistics Office (NSO).
the RTC immediately issued an Order dismissing the petition
The RTC cited the following provisions of the Rule on Declaration of Absolute Nullity of Void
Marriages and Annulment of Voidable Marriages (A.M. No. 02-11-10-SC)
Fujiki moved that the Order be reconsidered.
The... petitioner contended that the Japanese judgment was consistent with Article 35(4) of the Family Code of the
Philippines[11] on bigamy and was therefore entitled to recognition by Philippine courts.[12]
Issues:
Whether the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages
(A.M. No. 02-11-10-SC) is applicable.
Ruling:
A foreign judgment relating to the status of a marriage affects the civil status, condition and legal capacity of its
parties. However, the effect of a foreign judgment is not automatic. To extend the effect of a foreign judgment in the
Philippines, Philippine courts must... determine if the foreign judgment is consistent with domestic public policy and
other mandatory laws.[60] Article 15 of the Civil Code provides that "[l]aws relating to family rights and duties, or
to the status, condition and legal capacity of persons are... binding upon citizens of the Philippines, even though
living abroad." This is the rule of lex nationalii in private international law. Thus, the Philippine State may require,
for effectivity in the Philippines, recognition by Philippine courts of a foreign judgment... affecting its citizen, over
whom it exercises personal jurisdiction relating to the status, condition and legal capacity of such citizen.

9
A petition to recognize a foreign judgment declaring a marriage void does not require relitigation under a Philippine
court of the case as if it were a new petition for declaration of nullity of marriage. Philippine courts cannot presume
to know the foreign laws under which the... foreign judgment was rendered. They cannot substitute their judgment
on the status, condition and legal capacity of the foreign citizen who is under the jurisdiction of another state. Thus,
Philippine courts can only recognize the foreign judgment as a fact according to... the rules of evidence.
There is therefore no reason to disallow Fujiki to simply prove as a fact the Japanese Family Court judgment
nullifying the marriage between Marinay and Maekara on the ground of bigamy. While the Philippines has no
divorce law, the Japanese Family Court judgment is fully... consistent with Philippine public policy, as bigamous
marriages are declared void from the beginning under Article 35(4) of the Family Code. Bigamy is a crime under
Article 349 of the Revised Penal Code. Thus, Fujiki can prove the existence of the Japanese Family Court
judgment... in accordance with Rule 132, Sections 24 and 25, in relation to Rule 39, Section 48(b) of the Rules of
Court.
WHEREFORE, we GRANT the petition.
Principles:
Civil Law
A foreign judgment relating to the status of a marriage affects the civil status, condition and legal capacity of its
parties. However, the effect of a foreign judgment is not automatic. To extend the effect of a foreign judgment in the
Philippines, Philippine courts must... determine if the foreign judgment is consistent with domestic public policy and
other mandatory laws.[60] Article 15 of the Civil Code provides that "[l]aws relating to family rights and duties, or
to the status, condition and legal capacity of persons are... binding upon citizens of the Philippines, even though
living abroad." This is the rule of lex nationalii in private international law. Thus, the Philippine State may require,
for effectivity in the Philippines, recognition by Philippine courts of a foreign judgment... affecting its citizen, over
whom it exercises personal jurisdiction relating to the status, condition and legal capacity of such citizen.
A petition to recognize a foreign judgment declaring a marriage void does not require relitigation under a Philippine
court of the case as if it were a new petition for declaration of nullity of marriage. Philippine courts cannot presume
to know the foreign laws under which the... foreign judgment was rendered. They cannot substitute their judgment
on the status, condition and legal capacity of the foreign citizen who is under the jurisdiction of another state. Thus,
Philippine courts can only recognize the foreign judgment as a fact according to... the rules of evidence.

LLAVE V. REPUBLIC

G.R. No. 169766, [March 30, 2011]

PROCEDURAL HISTORY:

This petition for review on certiorari assails the Decision dated August 17, 2004 of the Court of Appeals (CA) in
CA-G.R. CV No. 61762 and its subsequent Resolution dated September 13, 2005, which affirmed the Decision of
the Regional Trial Court (RTC) of Quezon City, Branch 89 declaring petitioner Estrellita Juliano-Llave s (Estrellita)
marriage to Sen. Mamintal A.J. Tamano (Sen. Tamano) as void ab initio.

FACTS:

Around 11 months before his death, Sen. Tamanomarried Estrellita twice – initially under the Islamic laws and
tradition on May 27, 1993 in Cotabato City and, subsequently, under a civil ceremony officiated by an RTC Judge at
Malabang, Lanao del Sur on June 2, 1993. In their marriage contracts, Sen. Tamano s civil status was indicated as
“divorced”. Since then, Estrellita has been representing herself to the whole world as Sen. Tamano s wife, and upon
his death, his widow.

10
On November 23, 1994, private respondents Haja Putri Zorayda A. Tamano (Zorayda) and her son Adib Ahmad A.
Tamano (Adib), in their own behalf and in behalf of the rest of Sen. Tamano s legitimate children with Zorayda,
filed a complaint with the RTC of Quezon City for the declaration of nullity of marriage between Estrellita and Sen.
Tamano for being bigamous. The complaint alleged that Sen. Tamano married Zorayda on May 31, 1958 under civil
rites, and that this marriage remained subsisting when he married Estrellita in 1993.

ISSUE:

Whether the marriage between Estrellita and the late Sen. Tamano was bigamous.

HELD:

Yes. The civil code governs the marriage of Zoraydaand late Sen. Tamano; their marriage was never invalidated by
PD 1083. Sen. Tamano s subsequent marriage to Estrellita is void ab initio.

RATIO:

The marriage between the late Sen. Tamano and Zorayda was celebrated in 1958, solemnized under civil and
Muslim rites. The only law in force governing marriage relationships between Muslims and non-Muslims alike was
the Civil Code of 1950, under the provisions of which only one marriage can exist at any given time. Under the
marriage provisions of the Civil Code, divorce is not recognized except during the effectivity of Republic Act No.
394 which was not availed of during its effectivity.

As far as Estrellita is concerned, Sen. Tamano s prior marriage to Zorayda has been severed by way of divorce under
PD 1083, the law that codified Muslim personal laws. However, PD 1083 cannot benefit Estrellita. Firstly, Article
13(1) thereof provides that the law applies to “marriage and divorce wherein both parties are Muslims, or wherein
only the male party is a Muslim and the marriage is solemnized in accordance with Muslim law or this Code in any
part of the Philippines.” But Article 13 of PD 1083 does not provide for a situation where the parties were married
both in civil and Muslim rites.”

HELD:

The petition is DENIED.

SEA COMMERCIAL COMPANY v. CA +

DECISION

377 Phil. 221

GONZAGA-REYES, J.:

In this petition for review by certiorari, SEA Commercial Company, Inc. (SEACOM) assails the decision of the
Court of Appeals in CA-G.R. CV NO. 31263 affirming in toto the decision of the Regional Trial Court of Manila,
Branch 5, in Civil Case No. 122391, in favor of Jamandre Industries, Inc. (JII) et al., the dispositive portion of which
reads:

11
"WHEREFORE, judgment is hereby rendered in favor of the defendant and against the plaintiff, ordering the
plaintiff:

1) To pay defendant the sum of P66,156.15 (minus 18,843.85) with legal interest thereon, from the date of the filing
of the counterclaim until fully paid;

2) To pay defendant P2,000.00 as moral and exemplary damages;

3) To pay attorney's fees in the sum of P10,000.00; and

4) To pay the costs of this suit.

SO ORDERED."
SEACOM is a corporation engaged in the business of selling and distributing agricultural machinery, products and
equipment. On September 20, 1966, SEACOM and JII entered into a dealership agreement whereby SEACOM
appointed JII as its exclusive dealer in the City and Province of Iloilo [1] Tirso Jamandre executed a suretyship
agreement binding himself jointly and severally with JII to pay for all obligations of JII to SEACOM [2]. The
agreement was subsequently amended to include Capiz in the territorial coverage and to make the dealership
agreement on a non-exclusive basis[3]. In the course of the business relationship arising from the dealership
agreement, JII allegedly incurred a balance of P18,843.85 for unpaid deliveries, and SEACOM brought action to
recover said amount plus interest and attorney's fees.

JII filed an Answer denying the obligation and interposing a counterclaim for damages representing unrealized
profits when JII sold to the Farm System Development Corporation (FSDC) twenty one (21) units of Mitsubishi
power tillers. In the counterclaim, JII alleged that as a dealer in Capiz, JII contracted to sell in 1977 twenty-four
(24) units of Mitsubishi power tillers to a group of farmers to be financed by said corporation, which fact JII
allegedly made known to petitioner, but the latter taking advantage of said information and in bad faith, went
directly to FSDC and dealt with it and sold twenty one (21) units of said tractors, thereby depriving JII of unrealized
profit of eighty-five thousand four hundred fifteen and 61/100 pesos (P85,415.61).

The trial court rendered its decision on January 24, 1990 ordering JII to pay SEACOM the amount of Eighteen
Thousand Eight Hundred Forty Three and 85/100 (P18,843.85) representing its outstanding obligation. The trial
court likewise granted JII's counterclaim for unrealized profits, and for moral and exemplary damages and attorney'
fees as above quoted.

SEACOM appealed the decision on the counterclaim.

The Court of Appeals held that while there exists no agency relationship between SEACOM and JII, SEACOM is
liable for damages and unrealized profits to JII.

"This Court, however, is convinced that with or without the existence of an agency relationship between appellant
SEACOM and appellee JII and notwithstanding the error committed by the lower court in finding that an agency
relationship existed between appellant and defendant corporation the former is liable for the unrealized profits which
the latter could have gained had not appellant unjustly stepped in and in bad faith unethically intervened.

It should be emphasized that the very purpose of the dealership agreement is for SEACOM to have JII as its dealer
to sell its products in the provinces of Capiz and Iloilo. In view of this agreement, the second assigned error that the
lower court erred in holding that appellant learned of the FSDC transaction from defendant JII is clearly immaterial
and devoid of merit. The fact that the dealership is on a non-exclusive basis does not entitle appellant SEACOM to
join the fray as against its dealer. To do so, is to violate the norms of conduct enjoined by Art. 19 of the Civil Code.
By virtue of such agreement, the competition in the market as regards the sale of farm equipment shall be between
JII, as the dealer of SEACOM and other companies, not as against SEACOM itself. However, SEACOM, not
satisfied with the presence of its dealer JII in the market, joined the competition even as the against the latter and,
therefore, changed the scenario of the competition thereby rendering inutile the dealership agreement which they

12
entered into the manifest prejudice of JII. Hence, the trial court was correct when it applied Art. 19 of the Civil
Code in the case at bar in that appellant SEACOM acted in bad faith when it competed with its own dealer as
regards the sale of farm machineries, thereby depriving appellee JII of the opportunity to gain a clear profit of
P85,000.00."

and affirmed the judgment appealed from in toto.

Hence this petition for review on certiorari, which submits the following reasons for the allowance thereof:

THE RESPONDENT COURT OF APPEALS DECIDED QUESTIONS OF SUBSTANCE IN A WAY NOT IN

ACCORDANCE WITH LAW AND JURISPRUDENCE, CONSIDERING THAT:

THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING THAT PETITIONER IS LIABLE
TO PAY DAMAGES AND UNREALIZED PROFITS TO THE PRIVATE RESPONDENTS DESPITE THE
FACT THAT NO AGENCY RELATIONSHIP EXISTS BETWEEN THEM.

THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING THAT PETITIONER ACTED IN
BAD FAITH AGAINST THE PRIVATE RESPONDENT CORPORATION DESPITE THE FACT THAT SAID
RULING IS CONTRARY TO THE EVIDENCE ON RECORD.

C
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING THAT THE NON-
EXCLUSIVITY CLAUSE IN THE DEALERSHIP AGREEMENT EXECUTED BETWEEN THE PETITIONER
AND PRIVATE RESPONDENT CORPORATION PRECLUDES THE PETITIONER FROM COMPETING
WITH THE PRIVATE RESPONDENT CORPORATION.

THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING THAT PRIVATE RESPONDENT
IS ENTITLED TO UNREALIZED PROFITS, MORAL AND EXEMPLARY DAMAGES AND ATTORNEY'S
FEES.[4]

Petitioner SEACOM disputes the conclusion of the Court of Appeals that despite the fact that no agency relationship
existed between the parties, the SEACOM is still liable in damages and unrealized profits for the reason that it acted
in bad faith. Petitioner SEACOM invokes the non-exclusivity clause in the dealership agreement and claims that the
transaction with FSDC was concluded pursuant to a public bidding and not on the basis of alleged information it
received from private respondent Tirso Jamandre. Moreover, petitioner SEACOM claims that it did not underprice
its products during the public bidding wherein both SEACOM and JII participated. Petitioner also disputes the
award of moral damages to JII which is a corporation, in the absence of any evidence that the said corporation had a
good reputation which was debased.

Private respondents in their comment, contends that the four assigned errors raise mixed questions of fact and law
and are therefore beyond the jurisdiction of the Supreme Court which may take cognizance of only questions of
law. The assigned errors were also refuted to secure affirmance of the appealed decision. JII maintains that the

13
bidding set by FSDC on March 24, 1997 was scheduled after the demonstration conducted by JII, and after JII
informed SEACOM about the preference of the farmers to buy Mitsubishi tillers. JII further rebuts the SEACOM's
contention that the transaction with FSDC was pursuant to a public bidding with full disclosure to the public and
private respondent JII considering that JII had nothing to do with the list of 37 bidders and cannot be bound by the
listing made by SEACOM's employee; moreover, JII did not participate in the bidding not having been informed
about it. Furthermore, the price at which SEACOM sold to FSDC was lower than the price it gave to JII. Also,
even if the dealership agreement was not exclusive, it was breached when petitioner in bad faith sold directly to
FSDC with whom JII had previously offered the subject farm equipment. With respect to the awards of moral and
exemplary damages, JII seeks an affirmation of the ruling of the Court of Appeals justifying the awards.

SEACOM filed Reply defending the jurisdiction of this Court over the instant petition since the decision of the
Court of Appeals was "based on a misapprehension of facts". SEACOM insists that FSDC's purchase was made
pursuant to a public bidding, and even if SEACOM did not participate thereon, JII would not necessarily have
closed the deal since thirty seven (37) bidders participated. SEACOM contends that no evidence was presented to
prove that the bidding was a fraudulent scheme of SEACOM and FSDC. SEACOM further controverts JII's
contention that JII did not take part in the bidding as Tirso Jamandre was one of the bidders and that SEACOM
underpriced its products to entice FSDC to buy directly from it. In fine, JII is not entitled to the award of unrealized
profits and damages.

In its Rejoinder, private respondents insist that there is an agency relationship, citing the evidence showing that
credit memos and not cash vouchers were issued to JII by SEACOM for every delivery from November 26, 1976 to
December 24, 1978. Private respondents maintain that SEACOM "torpedoed the emerging deal between JII and
FSDC after being informed about it by JII by dealing directly with FSDC at a lower price" and after betraying JII,
SEACOM would cover up the deceit by conniving with FSDC to post up a "sham public bidding."

SEACOM's sur-rejoinder contains basically a reiteration of its contention in previous pleadings. Additionally, it is
contended that private respondents are barred from questioning in their Rejoinder, the finding of the Court of
Appeals that there is no agency relationship between the parties since this matter was not raised as error in their
comment.

The core issue is whether SEACOM acted in bad faith when it competed with its own dealer as regards the sale of
farm machineries to FSDC.

Both the trial court and the Court of Appeals held affirmatively; the trial court found that JII was an agent of
SEACOM and the act of SEACOM in dealing directly with FSDC was unfair and unjust to its agent, and that there
was fraud in the transaction between FSDC and SEACOM to the prejudice of JII. On the other hand, the Court of
Appeals ruled that there was no agency relationship between the parties but SEACOM is nevertheless liable in
damages for having acted in bad faith when it competed with its own dealer in the sale of the farm machineries to
FSDC. Both courts invoke as basis for the award Article 19 of the Civil Code which reads as follows:

"Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give
everyone his due and observe honesty and good faith."

The principle of abuse of rights stated in the above article, departs from the classical theory that "he who uses a right
injures no one". The modern tendency is to depart from the classical and traditional theory, and to grant indemnity
for damages in cases where there is an abuse of rights, even when the act is not illicit. [5]

Article 19 was intended to expand the concept of torts by granting adequate legal remedy for the untold
number of moral wrongs which is impossible for human foresight to provide specifically in statutory law. [6] If
mere fault or negligence in one's acts can make him liable for damages for injury caused thereby, with more
reason should abuse or bad faith make him liable. The absence of good faith is essential to abuse of right.
Good faith is an honest intention to abstain from taking any unconscientious advantage of another, even
through the forms or technicalities of the law, together with an absence of all information or belief of fact

14
which would render the transaction unconscientious. In business relations, it means good faith as understood
by men of affairs.[7]

While Article 19 may have been intended as a mere declaration of principle [8], the "cardinal law on human conduct"
expressed in said article has given rise to certain rules, e.g. that where a person exercises his rights but does so
arbitrarily or unjustly or performs his duties in a manner that is not in keeping with honesty and good faith, he opens
himself to liability.[9] The elements of an abuse of rights under Article 19 are: (1) there is a legal right or duty; (2)
which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring another. [10]

The issue whether JII is "entitled to recovery on its counterclaim for unrealized profit in the twenty one (21) units of
Mitsubishi power tillers sold by SEACOM to FSDC" was resolved by the trial court in favor of JII on the basis of
documentary evidence[11] showing that (1) JII has informed SEACOM as early as February 1977 of the promotions
undertaken by JII for the sale of 24 contracted units to FSDC and in connection therewith, requested a 50% discount
to make the price competitive, and to increase the warranty period for eight months to one year. In said letter
Jamandre clarified that they were not amenable to SEACOM's offering directly to FSDC" and to be only given the
usual overriding commission as "we have considerable investments on this transaction". (2) In response, the general
sales manager of SEACOM declined to give the requested 50% discount and offered a "less 30% less 10% up to end
March xxx on cash before delivery basis", granted the requested extension of the warranty period and stated that "we
are glad to note that you have quite a number of units pending with the FSDC."

The trial court ruled that with said information, SEACOM dealt directly with FSDC and offered its units at a lower
price, leaving FSDC "no choice but to accept the said offer of (SEACOM)".

In affirming the judgment of the of the trial court, the Court of Appeals held that by virtue of the dealership
agreement the competition in the market as regards the sale of farm equipment shall be between JII, as the dealer of
SEACOM, and other companies, not as against SEACOM itself, the Court stated:

"However, SEACOM not satisfied with the presence of its dealer JII in the market, joined the competition even as
against the latter, and thereby changed the scenario of the competition thereby rendering inutile the dealership
agreement which they entered into to the manifest prejudice of JII. Hence the trial court trial court was correct when
it applied Art. 19 of the Civil Code in the case at bar in that appellant SEACOM acted in bad faith when it competed
with its own dealer as regards the sale of farm machineries, thereby depriving appellee JII of the opportunity to gain
a clear profit of P85,000.00."

We find no cogent reason to overturn the factual finding of the two courts that SEACOM joined the bidding for the
sale of the farm equipment after it was informed that JII was already promoting the sales of said equipment to the
FSDC. Moreover, the conclusion of the trial court that the SEACOM offered FSDC a lower price than the price
offered by JII to FSDC is supported by the evidence: the price offered by JII to FSDC is P27,167 per unit [12] but the
prices at which SEACOM sold to FSDC were at P22,867.00 for Model CT 83-2, P21,093.50 for model CT 83-E,
and P18,979.25 for model CT 534. The fact that SEACOM may have offered to JII, in lieu of a requested 50%
discount, a discount effectively translating to 37% of the list price and actually sold to FSDC at 35% less than the
list price[13] does not detract from the fact that by participating in the bidding of FSDC, it actually competed with its
own dealer who had earlier conducted demonstrations and promoted its own products for the sale of the very same
equipment, Exh. "N" for the plaintiff confirms that both SEACOM and Jamandre participated in the
bidding.[14] However, the SEACOM was awarded the contract directly from Manila.[15] The testimony of Tirso
Jamandre that JII was the sole representative of SEACOM in the local demonstrations to convince the farmers and
cooperative officers to accept the Mitsubishi brand of equipment in preference to other brands, was unrebutted by
SEACOM.

Clearly, the bad faith of SEACOM was established. By appointing as a dealer of its agricultural equipment,
SEACOM recognized the role and undertaking of JII to promote and sell said equipment. Under the dealership
agreement, JII was to act as a middleman to sell SEACOM's products, in its area of operations, i.e. Iloilo and Capiz
provinces, to the exclusion of other places,[16] to send its men to Manila for training on repair, servicing and

15
installation of the items to be handled by it, and to comply with other personnel and vehicle requirements intended
for the benefit of the dealership.[17] After being informed of the demonstrations JII had conducted to promote the
sales of SEACOM equipment, including the operations at JII's expense conducted for five months, and the approval
of its facilities (service and parts) by FSDC,[18] SEACOM participated in the bidding for the said equipment at a
lower price, placing itself in direct competition with its own dealer. The actuations of SEACOM are tainted by bad
faith.

Even if the dealership agreement was amended to make it on a non-exclusive basis,[19] SEACOM may not exercise
its right unjustly or in a manner that is not in keeping with honesty or good faith; otherwise it opens itself to liability
under the abuse of right rule embodied in Article 19 of the Civil Code above-quoted. This provision, together with
the succeeding article on human relation, was intended to embody certain basic principles "that are to be observed
for the rightful relationship between human beings and for the stability of the social order." [20] What is sought to be
written into the law is the pervading principle of equity and justice above strict legalism. [21]

We accordingly resolve to affirm the award for unrealized profits. The Court of Appeals noted that the trial court
failed to specify to which the two appellees the award for moral and exemplary damages is granted. However, in
view of the fact that moral damages are not as a general rule granted to a corporation, and that Tirso Jamandre was
the one who testified on his feeling very aggrieved and on his mental anguish and sleepless nights thinking of how
SEACOM "dealt with us behind (our) backs",[22] the award should go to defendant Jamandre, President of JII.

WHEREFORE, the judgment appealed from is AFFIRMED with the modification that the award of P2,000.00 in
moral and exemplary damages shall be paid to defendant Tirso Jamandre.

Costs against appellant.

SO ORDERED.

Garciano vs. Court of Appeals

Liability for damages under Articles 19, 20 and 21 of the Civil Code arises only from unlawful, willful or negligent
acts that are contrary to law, or morals, good customs or public policy.

The Court of Appeals was correct in finding that petitioner’s discontinuance from teaching was her own choice.
While the respondents admittedly wanted her service terminated, they actually did nothing to physically prevent her
from reassuming her post, as ordered by the school’s Board of Directors. That the school principal and Fr. Wiertz
disagreed with the Board’s decision to retain her, and some teachers allegedly threatened to resign en masse, even if
true, did not make them liable to her for damages. They were simply exercising their right of free speech or their
right to dissent from the Board’s decision. Their acts were not contrary to law, morals, good customs or public
policy. They did not “illegally dismiss” her for the Board’s decision to retain her prevailed. She was ordered to
report for work on July 5, 1982, but she did not comply with that order. Consequently, whatever loss she may have
incurred in the form of lost earnings was self-inflicted. Volenti non fit injuria.

G.R. No. 96126 August 10, 1992

ESTERIA F. GARCIANO, petitioner,

vs.
THE HON. COURT OF APPEALS, EMERITO LABAJO, LUNISITA MARODA, LALIANA DIONES,
CANONISA PANINSORO, DIONISIO ROSAL, REMEDIOS GALUSO, FLORDELUNA PETALCORIN,
MELCHIZEDECH LOON, NORBERTA MARODA and JOSEPH WIERTZ, respondents.

Basilio E. Duaban for petitioner.

16
Julius Z. Neri for private respondent.

GRIÑO-AQUINO, J.:

This is a petition for review of the decision of the Court of Appeals dismissing the complaint for damages filed by
the petitioner against the private respondents.

The petitioner was hired to teach during the 1981-82 school year in the Immaculate Concepcion Institute in the
Island of Camotes. On January 13, 1982, or before the school year ended, she applied for an indefinite leave of
absence because her daughter was taking her to Austria where her daughter was employed (Exh. B). The application
was recommended for approval by the school principal, Emerito O. Labajo, and approved by the President of the
school's Board of Directors (Exh. B-1).

On June 1, 1982, Emerito Labajo addressed a letter to the petitioner through her husband, Sotero Garciano (for she
was still abroad), informing her of the decision of Fr. Joseph Wiertz, the school's founder, concurred in by the
president of the Parent-Teachers Association and the school faculty, to terminate her services as a member of the
teaching staff because of: (1) the absence of any written contract of employment between her and the school due to
her refusal to sign one; and (2) the difficulty of getting a substitute for her on a temporary basis as no one would
accept the position without a written contract (Exhs. C and 1). Upon her return from Austria in the later part of June,
1982, she received the letter informing her that her services at the Immaculate Concepcion Institute had been
terminated. She made inquiries from the school about the matter and, on July 7, 1982, the members of the Board of
Directors of the school, with the exception of Fr. Joseph Wiertz, signed a letter notifying her that she was "reinstated
to report and do your usual duties as Classroom Teacher . . . effective July 5, 1982," and that "any letter or notice of
termination received by you before this date has no sanction or authority by the Board of Directors of this
Institution, therefore it is declared null and void . . ." (Exhs. D and 2).

On July 9, 1982, the president, vice president, secretary, and three members of the Board of Directors, out of a
membership of nine (9), resigned their positions from the Board "for the reason that the ICI Faculty, has reacted
acidly to the Board's deliberations for the reinstatement of Mrs. Esteria F. Garciano, thereby questioning the
integrity of the Board's decision" (Exh. E).

On September 3, 1982, petitioner filed a complaint for damages in the Regional Trial Court, Cebu, Branch XI,
against Fr. Wiertz, Emerito Labajo, and some members of the faculty of the school for discrimination and unjust and
illegal dismissal.

After trial, the lower court rendered a decision on August 30, 1985, ordering the defendants jointly and severally to
pay her P200,000 as moral damages, P50,000 exemplary damages, P32,400 as lost earnings for nine years, and
P10,000 as litigation expenses and attorney's fees.

The defendants (now private respondents) appealed to the Court of Appeals (CA-G.R. CV No. 10692), which on
August 30, 1990 reversed the trial court's decision thus:

WHEREFORE, the decision appealed from is reversed, the complaint is dismissed, and
defendants-appellants are absolved from any liability to plaintiff-appellee. With costs against
plaintiff-appellee. (p. 13, Rollo.)

The plaintiff-appellee (now petitioner) filed a motion for reconsideration which the Court of Appeals denied on
October 26, 1990. Hence, this petition for review wherein the lone error assigned by petitioner reads:

17
 Respondent Court of Appeals gravely erred in absolving the private respondents from liability by
faulting the petitioner for her failure to report back to her work. (p. 6, Rollo.)

After a careful perusal of the petition and the respondents' comments, the Court resolved to deny the petition for lack
of merit.

The board of directors of the Immaculate Concepcion Institute, which alone possesses the authority to hire and fire
teachers and other employees of the school, did not dismiss the petitioner. It in fact directed her to report for work.
While the private respondents sent her a letter of termination through her husband, they admittedly had no authority
to do so. As the Court of Appeals aptly observed:

We agree with defendants-appellants, however, that they should not have been held liable to
plaintiff-appellee for damages. Defendants-appellants had no authority to dismiss plaintiff-
appellee and the latter was aware of this. Hence, the letter of termination sent to her through her
husband (Exhs. C and 1) by defendants-appellants had no legal effect whatsoever. It did not
effectively prevent her from reporting for work. What is more, it was subsequently repudiated by
the Board of Directors which directed her to report for work. (Exhs. D and 2) There was,
therefore, no reason why she did not continue with her teaching in the school. No evidence had
been presented to show that defendants-appellants prevented her from reporting for work. The fact
that defendants-appellants had "acidly" received the action of the Board of Directors repudiating
their decision to terminate plaintiff-appellee is not proof that defendants-appellants had effectively
and physically prevented plaintiff-appellee from resuming her post. It was nothing more than a
reaction to what defendants-appellants perceived as an affront to their collective prestige. It would
appear, therefore, that plaintiff-appellee voluntarily desisted from her teaching job in the school
and has no right to recover damages from defendants-appellants. (p. 13, Rollo.)

Liability for damages under Articles 19, 20 and 21 of the Civil Code arises only from unlawful, willful or negligent
acts that are contrary to law, or morals, good customs or public policy.

Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act
with justice, give everyone his due, and observe honesty and good faith.

Art. 20. Every person who, contrary to law, willfully or negligently causes damage to another,
shall indemnify the latter for the same.

Art. 21. Any person who willfully causes loss or injury to another in a manner that is contrary to
morals, good customs or public policy shall compensate the latter for the damage.

The Court of Appeals was correct in finding that petitioner's discontinuance from teaching was her own choice.
While the respondents admittedly wanted her service terminated, they actually did nothing to physically prevent her
from reassuming her post, as ordered by the school's Board of Directors. That the school principal and Fr. Wiertz
disagreed with the Board's decision to retain her, and some teachers allegedly threatened to resign en masse, even if
true, did not make them liable to her for damages. They were simply exercising their right of free speech or their
right to dissent from the Board's decision. Their acts were not contrary to law, morals, good customs or public
policy. They did not "illegally dismiss" her for the Board's decision to retain her prevailed. She was ordered to report
for work on July 5, 1982, but she did not comply with that order. Consequently, whatever loss she may have
incurred in the form of lost earnings was self-inflicted. Volenti non fit injuria.

With respect to petitioner's claim for moral damages, the right to recover them under Article 21 is based on equity,
and he who comes to court to demand equity, must come with clean hands. Article 21 should be construed as
granting the right to recover damages to injured persons who are not themselves at fault (Mabutas vs. Calapan
Electric Co. [CA] 50 OG 5828, cited in Padilla, Civil Code Annotated, Vol. 1, 1975 Ed., p. 87). Moral damages are
recoverable only if the case falls under Article 2219 in relation to Article 21 (Flordelis vs. Mar, 114 SCRA 41). In
the case at bar, petitioners is not without fault. Firstly, she went on an indefinite leave of absence and failed to report

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back in time for the regular opening of classes. Secondly, for reasons known to herself alone, she refused to sign a
written contract of employment. Lastly, she ignored the Board of Directors' order for her to report for duty on July 5,
1982.

The trial court's award of exemplary damages to her was not justified for she is not entitled to moral, temperate or
compensatory damages. (Art. 2234, Civil Code).

In sum, the Court of Appeals correctly set aside the damages awarded by the trial court to the petitioner for they did
not have any legal or factual basis.

WHEREFORE, the petition is DISMISSED for lack of merit and the decision of the Court of Appeals is
AFFIRMED.

SO ORDERED.

SERGIO AMONOY, petitioner

vs

Spouses JOSE GUTIERREZ and ANGELA FORNIDA, respondents

Doctrine:
Damages can be claimed whenever there is abuse of right or exercise of a suspended or extinguished right.
Facts:
On May 30, 1986, the petitioner commenced the demolition of the respondent’s house under the authority of a Writ
of Demolition issued by the Regional Trial Court (RTC). However, records show that a Temporary Restraining
Order (TRO) was issued by the Supreme Court (SC) on June 2 , 1986 enjoining the demolition. It was also found out
that the copy of the said TRO was also served to the petitioner on June 4, 1986. But the petitioner did not heed to the
TRO and continued the demolition until mid of 1987.

In this case, the petitioner was contending that the damages claimed by the respondent are not valid because he is
just exercising his right.

Issue:
Whether or not the contention of the petitioner is correct.

Held:
No, the petitioner’s contention is not correct.

Damnum absque injuria is theprinciple that damage resulting from legitimate exercise of a person’s right is a loss
without injury for which the law gives no remedy.
However, in the case at bar, the principle of damnum absque injuria cannot be applied because he abuses his right
and exercise his suspended and extinguished right to demolish the respondent’s house.
Hence, petitioner is liable for the damages incurred in his abusive exercise of a suspended right.

002
(STANFILCO) DOLE PHILIPPINES, INC.,Petitioner
vs
REYNALDO B. RODRIGUEZ and LIBORIO AFRICA, Respondent.
G.R. No. 174646 – August 22, 2012

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Original Court:
Regional Trial Court (RTC) of Makati City ,Branch 134.

Subject Matter:
The principle of damnumabsqueinjuria and acts contra bonus mores.

Facts:

Checkered Farms entered into an Exclusive Purchasing Agreement with petitioner which bound itself to purchase all
the acceptable bananas that would be produced by the former.Checkered Farms, in return allow petitioner to
introduce installations and improvements on the land and to dismantle and remove all non-permanent installations
and improvements it has introduced upon the expiration of the period of the contract. Rodriguez, the new owner of
the said land, authorized petitioner to manage the plantation under an interim arrangement pending final resolution
of their negotiation. In the same letter, Rodriguez demanded for the accounting of fruits harvested from the
expiration of their contract, petitioners failed and refused to pay, in fact,raided the subject plantation destroying the
facilities therein arguing that the contract expires and have the right to dismantle their own installations.

In the court, petitioner insists that it cannot be held liable for damages' allegedly suffered by respondents based on
the principle of damnumabsqueinjuria and such act was acts contra bonus mores.

ISSUE: Whether the principle of damnumabsqueinjuria justifies the petitioner’s right to remove the improvements
on the subject plantation?

RULING:

No. Under the principle of damnumabsqueinjuria, the legitimate exercise of a person's rights, even if it causes loss to
another, does not automatically result in an actionable injury. The law does not prescribe a remedy for the loss. This
principle, however, does not apply when there is an abuse of a person's right as in this case.[72] While we recognize
petitioner's right to remove the improvements on the subject plantation, it, however, exercised such right arbitrarily,
unjustly and excessively resulting in damage to respondents' plantation. The exercise of a right, though legal by
itself, must nonetheless be in accordance with the proper norm. When the right is exercised arbitrarily, unjustly or
excessively and results in damage to another, a legal wrong is committed for which the wrongdoer must be held
responsible.

Civil Code, Article 21,any person who willfully causes loss or injury to another in a manner that is contrary to
morals, good customs, or public policy shall compensate the latter for the damage; this refers to acts contra bonus
mores. The act is within the article only when it is done willfully. The act is willful if it is done with knowledge of
its injurious effect; it is not required that the act be done purposely to produce the injury.

Undoubtedly, petitioner removed the pipes with knowledge of its injurious effect which is the destruction of the
banana plants and fruits; and failed to cover the diggings which caused ground destruction. Petitioner should,
therefore, be liable for damages.

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